Oil Prices Slip Amid U.S.-China Trade Uncertainty and OPEC+ Output Hike Expectations

Oil prices edged lower during Asian trading hours on Monday, extending last week's downward trend. Lingering concerns over the escalating U.S.-China trade war and expectations of increased production from OPEC+ weighed heavily on market sentiment.

1. Oil Prices Under Pressure from U.S.-China Trade Tensions

Oil markets remain fragile as fears of weakening demand persist, especially amid the intensifying trade conflict between the United States and China, with little sign of resolution.
Mixed signals from both Washington and Beijing regarding trade negotiations have further fueled uncertainty.

Throughout the year, oil prices have suffered significant declines due to President Donald Trump’s aggressive tariff program targeting Chinese imports. Higher tariffs imposed on China — the world’s largest oil importer — have triggered widespread market anxiety over global economic growth and future oil demand.

Adding to the pressure, President Trump has repeatedly called for lower energy prices and encouraged higher domestic oil production, which has contributed to bearish sentiment in recent months.

In early Asian trading Monday, Brent crude futures for June delivery fell by 0.2% to $66.71 a barrel, while West Texas Intermediate (WTI) crude held steady at $62.91 a barrel.

2. Lingering U.S.-China Trade Negotiation Uncertainty

One of the main factors clouding the market outlook is the ongoing uncertainty surrounding U.S.-China trade negotiations.
On Sunday, U.S. Treasury Secretary Scott Bessent stated that he was unaware whether President Trump had directly communicated with Chinese President Xi Jinping and did not know of any ongoing direct trade talks.

His comments contradicted previous statements by President Trump, who had suggested that negotiations with China were progressing. Meanwhile, Beijing also reiterated last week that no official trade discussions were currently underway.

This inconsistency has intensified fears over the trade war's escalation, especially as the two economic powerhouses have engaged in a fierce tariff exchange throughout April.
Investors worry that trade disruptions could dampen global growth prospects and significantly curb oil demand in the coming months.

Traders remain cautious, bracing for further volatility until more concrete developments emerge from U.S.-China trade discussions.

3. Spotlight on Upcoming OPEC+ Meeting

Beyond trade tensions, the oil market is also turning its focus toward the upcoming OPEC+ meeting scheduled for next week.
The coalition of oil-producing nations is widely expected to agree on a second consecutive production increase, aiming to counteract falling oil prices and stabilize supply levels.

In recent months, OPEC+ has gradually scaled back its production cuts, which had been in place for the past three years.
The move aligns with President Trump’s calls for increased output to lower energy costs for American consumers.

According to market analysts, an OPEC+ production hike could help offset supply shortages stemming from sanctions on Russia and Iran, but it could also add downward pressure to global crude prices.

The combined impact of a potential OPEC+ output hike and persistent trade uncertainty has made the oil market extremely sensitive to geopolitical developments.
Analysts forecast that oil prices may remain under pressure in the near term, pending clearer signals from either trade negotiations or production policy shifts.

Conclusion

Global oil prices are navigating a challenging landscape, beset by simultaneous headwinds from U.S.-China trade tensions and shifting OPEC+ production strategies.
In the short term, oil investors should closely monitor geopolitical events and macroeconomic policy changes to better anticipate major price swings and adjust their strategies accordingly.

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